Molokai gets 90-day water extension

Associated Press

The state Department of Health ordered Molokai Properties Ltd. and its subsidiary utilities yesterday to continue providing drinking water and waste-water services on the Friendly Island for at least 90 days.

The department said it also ordered Maui County to prepare to step in and operate the services if they are halted.

The company, also known as Molokai Ranch, announced in March it would shut down ranch and resort operations and lay off more than 120 employees. It later said it would be unable to provide utility services after August because of financial considerations.

The state Public Utilities Commission had urged Maui County officials to acquire the water and waste-water systems serving 1,200 residents and businesses. But Maui Mayor Charmaine Tavares said the county could not take over the utilities on such short notice.

"The Department of Health is exercising its authority to order immediate action to protect the public health from an imminent and substantial danger if the services are stopped," said Laurence Lau, department deputy director for environmental health.

The company and its utilities are required to provide a written report every seven days on the status of their operations. The county must also submit weekly assessments, including preparedness status reports.

Hearings on the orders were scheduled for today in Honolulu.

Molokai Properties has said it covered a $580,000 net loss for the utilities in the fiscal year ended June 30, 2007, and a $566,000 net loss for the first 11 months of this past fiscal year.

In announcing it was shutting down, Molokai Properties cited its inability to win approval for a plan to build 200 luxury homes at Laau Point. The company, which owns 60,000 acres, or about one-third of the island, is a subsidiary of Singapore-based GuocoLeisure Ltd.